Buying "Owner's time" Charters

Sailonline.com offers owner's time, available at significant discounts. What does this mean, how does it work, and where is the catch, you might wonder?

Before anything else, let's just say this: if you'd rather pay the charter company more money than the owner, for exactly the same boat and services, then stop reading right now. But if you want hear about a best-kept-secret great deal, yet are still somewhat skeptical, then read on!

Charter fleet yachts are privately owned.

When people decide to buy a boat and place it into charter management, it's for a variety of reasons, but the main considerations are:

Pay down a new boat more quickly by having it managed and marketed for charters by a charter company.

Sail a certain number of weeks per year -usually 6 to 10 or 12 Â weeks.

Have the costly components — marketing, maintenance, insurance, dock fees, haul-out, etc.-under the responsibility of the charter management company; owners have only to assume mortgage payments, which are typically covered by the owner's share of the charter income.

In the case where the owner is under a fixed Guaranteed Income contract with the charter company, he does not pay any cost and has a yearly number of weeks to dispose of.

Why do boat owners sell their time?

If a charter boat owner cannot use all his/her yearly 9 to 12-week allotment for whatever reason (family, work obligations, etc.), then this owner has the following options: donate it to charity; just do nothing and waste a potential incremental income; or sell his/her unused time, which is a perfectly legitimate contractual privilege with most charter companies. Many owners decide to do the latter, which makes a lot of sense, of course.

How does it work?

If an owner decides to sell his/her unused weeks and markets them accordingly, the would-be charterers contact that owner, say via an Internet ad. If a deal is struck, the owner contacts the charter company directly and arranges for "Owner's time", which means it's deducted from his/her owner's usage allocation, as per the contract. While the owner's name is on the contract, the owner's clients or "guests of the owner" are also listed. Usually, the charterer will even be able to confirm the charter directly with the Charter Company.

At the end of the day, a charter booked through an owner has absolutely the same contractual guarantees and amenities as if it had been booked with the Charter Company. The only major difference is who and how much you pay.

To illustrate this better, here is the most FAQ, and the simple answer below.

Q. I like that concept. But I don't quite understand who I would be dealing with at the marina/base. Who does the check out and the chart briefing? And if there is a problem with the boat while we are underway, who handles that? The charter company or the owner?

A. Once you have paid the owner, the entire administration is taken over by the charter company's "Owners Desk" (at least, this is true for the major charter companies). From that point on, the charterer (you) is treated exactly as any other charterer, or, even better, as the owner himself in regard to all the issues above. You will receive a regular, full-fledged charter contract from the charter company. In other words, you're buying a full service charter at a large discount.

How can owners afford to sell their weeks at such considerable discounts?

A. Regular booking:

You decide to charter a Boat XYZ in mid-season. You call a charter company and you're quoted $6,500 per week. The owner will receive, for example, by contract, 25% of the charter income, or about Â $1,625 after all his expenses are paid, or will receive nothing if he is in a Guaranteed Income management contract.

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B. Booking directly through an owner:

The owner can afford to knock off up to 40% off the charter company's rate. Your cost for the week then comes down to $3,900. As a result, you save $2,600. But the owner, cashes $3,900 instead of $1,625 or instead of Zero. Do you get the idea? (See the table below.)

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Booking through Charter Company

Booking through Owner(based on 40% discount)

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You Pay:

$6,500

$3,900

You SAVE:

$2,600

OwnerÂ Receives:

$1,625 or 0

$3,900

Owner's Bonus:

$1,625 to 3,900

Additional Benefits

When you book a charter through and owner, you also benefit from lower penalties if you cancel the charter. You will probably pay a penalty, but not nearly as severe as if you had booked through the Charter Company. A charter company will typically make you forfeit your entire monies if you cancel inside of 90 days of departure. A cancellation penalty with an owner will be much less severe.

This is one great deal where (for a change) there is absolutely no catch. And in the end, as a charterer, it's your choice: pay more to the charter company , or less to the owner for exactly the same boat and services.*

*Note: Owners and charterers: Once you enter a negotiation, it is your responsibility to finalize the transaction and all its terms. Sailonline.com cannot be held responsible for anything else than displaying the postings.